By Greg Hunter’s USAWatchdog.com
The top story is the global economy. It’s not fixed and there is no real recovery. Yes, I know the stock market hit all-time highs again, but that’s because the market believes the Fed; and now the European Central Bank will continue the easy money policies. The ECB just announced it will go to negative interest rates of -.1% on deposits. That’s right. In, Europe you have to pay a bank to hold your money! If Europe was really in a so-called “recovery” as we have been told constantly for several years, would it need to go negative on interest rates? Of course, it wouldn’t. ZeroHedge.com called the move for negative interest rates “Officially Entering the Monetary Twilight Zone.” It is no less than confirmation that nothing the ECB has done to date has fixed anything, and, in fact, the economy has gotten worse. Please keep in mind, the Eurozone is in trouble despite the tens of trillions of dollars the Fed pumped into it through its swap lines.
Back here in the U.S., we are continually told there is a recovery. Check out this headline in the USA Today newspaper: “Fed: Economy expands across USA.” Listen to this quote from the article that says, “While manufacturing picked up smartly across much of the country, consumer spending and housing were mixed as remnants of the adverse weather conditions continue to have some effects in the Northeast.” What planet are they living on? It’s June and they are still blaming the weather for the economic slowdown? Retail and housing numbers have rolled over–they are not “mixed.” They have tanked. 10 million homeowners still have negative equity in their homes. Despite a near 4% 30-year mortgage rate, home prices, according to one new report, are still falling. With this low rate, home sales should be taking off like a rocket—they are not. Maybe this is why 70 % of Americans think the housing crisis is not over, or the worst is yet to come, according to a new survey. Also, what we now know is the first quarter of 2014 had a -1% contraction, and that was a stunning drop from the 2.6% growth the government “officially” reported in 4th quarter of 2013.
You want proof the economy is tanking? This is a wire story that came out the same day, and it reads “Hiring slowed by U.S. Firms in May.” Payroll processor ADP is reporting private companies are hiring less people. Wouldn’t it be increasing if there was a recovery? How about the nearly 50 million people on food stamps? What about the more than 90 million people no longer in the workforce? There are record numbers of people on food stamps—nearly 50 million. Wasn’t QE, or money printing, supposed to fix this? The Fed printed tens of trillions of dollars since the financial panic. It has instituted 0% interest rates, and there are no plans of ending them for years. There is still phony accounting being allowed in that financial institutions can look solvent by attaching fantasy valuations to the underwater assets they have on the books. With all of this, there is still no real recovery. The Fed policies are a total failure for the common man. What the Fed has done, according to the Department of Agriculture, is raise food prices. Recent data shows food inflation in the U.S. is on a 22% pace for this year.
The G-7 met in Europe this week to talk about the country they kicked out of the group—Russia. President Obama wants to push for more sanctions against Russia because of the Ukraine crisis and wants Vladimir Putin to work a peace deal with the newly elected Ukraine leader Petro Poroshenko. Most of the rest of the G-7 members look like they don’t want to increase sanctions. Again, the European economy is tanking. This is why the ECB so desperately cut deposit rates to negative interest? Obama is not going to be meeting with Putin, but the leaders of Germany, France and the UK are going to. Doesn’t that make or President look weak with questionable support from our allies?
Finally, the prisoner trade, where we traded five killers of the Taliban for a deserter held in Afghanistan. The Obama Administration bypassed the objections of the military and did the trade. Why did he do it? Lots of people, on both sides of the political spectrum, think it was a very bad idea and a very bad deal. Sargent Bergdahl is clearly a deserter, and according to the evidence I have seen, he looks like a Taliban conspirator. The most disturbing thing is why the President did this and why didn’t he consult Congress before he did it? Lots of people say the President had dark motives. That may be true, but I see it as a continuation of incompetence. I mean, they had Susan Rice go out again and say Bergdahl served with “honor and distinction.” That is clearly not the case, and she had to have known that. It seems, every week or so, there is another Obama Administration scandal or screw-up. The American image has been severely damaged on the world stage, and will hurt all Americans.
Join Greg Hunter as he analyzes these stories and more in the Weekly News Wrap-Up.